Introduction
Crude oil futures (CL) have continued to consolidate since our previous analysis. Despite last week’s rebound from $56–$57 support, buyers have not been able to force a breakout above the 50-day moving average.
Bears will be aiming for the lower support zone at $56, while bulls will be trying to push the price above the resistance of the 50-day moving average.
Technical Overview
The 50-day MA remains the first hurdle, as already mentioned above. Each recent attempt to break above it has been rejected on all time frames. As long as CL remains below this moving average, upside momentum will struggle. Looking long-term, the 200-day moving average hasn’t been tested since late July. This will be the first major price that bulls will need to break above for a new uptrend to commence.
The consolidation that we are seeing in CL will likely continue unless we see a shift in the fundamental picture.
RSI & Momentum
The RSI is on the 50 line, reaffirming the consolidation that we are seeing in the price action.
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| Type | Level | Description |
|---|---|---|
| Resistance 1 | 60.80–61.50 | Short-term supply zone. |
| Resistance 2 | 60.99 | 50-day moving average. |
| Resistance 3 | 64.42 | 200-day MA. |
| Support 1 | 58.00 | Short-term floor. |
| Support 2 | 56.50–57.00 | Major support zone. |
| Support 3 | 55.00 | S3 pivot / breakdown target. |
Scenario Probabilities (Next 2–3 Weeks)
| Scenario | Estimated Probability | Notes |
|---|---|---|
| Range continuation between $57–$61 | 60% | Current structure favors more sideways trading. |
| Breakout above 61.50 → test 63–64 | 25% | Requires decisive reclaim of the 50-day MA. |
| Breakdown below $57 → $55 | 15% | Only likely if macro sentiment worsens or inventories spike. |
Fundamental Notes
Crude oil remains stuck in a tug-of-war. On the bearish side, the outlook for global demand is softening, U.S. production continues to rise, and recent EIA reports show inventory builds. Mixed economic data from China is also dampening expectations for energy demand.
On the bullish side, OPEC+ continues to monitor potential supply cuts, while ongoing tensions in the Middle East are keeping a risk premium in place. Meanwhile, the U.S. dollar has stabilized around the 100 level, offering some support to commodities.
At this stage, the fundamentals aren’t strong enough to fuel a sustained breakout, which lines up with the current technical range-bound price action.
This analysis is for educational and informational purposes only and does not constitute trading advice or a recommendation to buy or sell any futures contracts. Futures trading involves significant risk and may not be suitable for all investors. Always conduct your own research and consult with a licensed financial professional before making trading decisions.
